1-1     By:  Bernsen                                          S.B. No. 1640
 1-2           (In the Senate - Filed March 9, 2001; March 14, 2001, read
 1-3     first time and referred to Committee on Jurisprudence;
 1-4     April 10, 2001, reported favorably by the following vote:  Yeas 7,
 1-5     Nays 0; April 10, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to a provision for the payment or transfer of a person's
 1-9     interest in a mutual fund account on the person's death.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Subsection (a), Section 450, Texas Probate Code,
1-12     is amended to read as follows:
1-13           (a)  Any of the following provisions in an insurance policy,
1-14     contract of employment, bond, mortgage, promissory note, deposit
1-15     agreement, employees' trust, retirement account, deferred
1-16     compensation arrangement, custodial agreement, pension plan, trust
1-17     agreement, conveyance of real or personal property, securities,
1-18     accounts with financial institutions as defined in Part 1 of this
1-19     chapter, mutual fund account, or any other written instrument
1-20     effective as a contract, gift, conveyance, or trust is deemed to be
1-21     nontestamentary, and this code does not invalidate the instrument
1-22     or any provision:
1-23                 (1)  that money or other benefits theretofore due to,
1-24     controlled, or owned by a decedent shall be paid after his death to
1-25     a person designated by the decedent in either the instrument or a
1-26     separate writing, including a will, executed at the same time as
1-27     the instrument or subsequently;
1-28                 (2)  that any money due or to become due under the
1-29     instrument shall cease to be payable in event of the death of the
1-30     promisee or the promissor before payment or demand; or
1-31                 (3)  that any property which is the subject of the
1-32     instrument shall pass to a person designated by the decedent in
1-33     either the instrument or a separate writing, including a will,
1-34     executed at the same time as the instrument or subsequently.
1-35           SECTION 2.  The change in law made by this Act to Subsection
1-36     (a), Section 450, Texas Probate Code, applies to a provision for
1-37     the payment or transfer of a person's interest in a mutual fund
1-38     account on the person's death, regardless of when the provision was
1-39     executed or the account was established.
1-40           SECTION 3.  This Act takes effect immediately if it receives
1-41     a vote of two-thirds of all the members elected to each house, as
1-42     provided by Section 39, Article III, Texas Constitution.  If this
1-43     Act does not receive the vote necessary for immediate effect, this
1-44     Act takes effect September 1, 2001.
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